External broker reports(aggregated public sources), Topline Securities

Topline Securities

External broker reports(aggregated public sources)

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Equity Bottom-Up

<ul><li>Mari Energies (MARI) has announced the approval of gas allocation from its Ghazij/Shawal discoveries in the Mari field at well head gas prices notified by OGRA (i.e. Petroleum Policy 2012 prices).</li><li>Under the revised allocation, the flows from MARI from HRL, Ghazij/Shawal, Deep and SML/SUL will increase to 1054mmcfd from the current direct allocation of ~850-900mmcfd over the next 2-3 years, following the development of the required infrastructure. This is a whopping increase of 180mmcfd.</li><li>Based on our estimates, if MARI volumes go up by 100mmcfd, it will result in an earnings impact of Rs13.5 per share, which is 25-29% of FY26/27 earnings. With incremental volumes of 180mmcfd, this impact would be Rs24.1 per share (or 40-50%).</li></ul>

Mari Energies (MARI) has announced the approval of gas allocation from its Ghazij/Shawal discoveries in the Mari field at well head gas prices notified by OGRA (i.e. Petroleum Policy 2012 prices).Under the revised allocation, the flows from MARI from HRL, Ghazij/Shawal, Deep and SML/SUL will increase to 1054mmcfd from the current direct allocation of ~850-900mmcfd over the next 2-3 years, following the development of the required infrastructure. This is a whopping increase of 180mmcfd.Based on our estimates, if MARI volumes go up by 100mmcfd, it will result in an earnings impact of Rs13.5 per share, which is 25-29% of FY26/27 earnings. With incremental volumes of 180mmcfd, this impact would be Rs24.1 per share (or 40-50%).

Pakistan Oil & Gas and Fertilizer – Allocation of Gas from Mari Field; MARI to Emerge as Beneficiary; Neutral for Fertilizer Companies

<ul><li>Mari Energies (MARI) held its 41st Annual General Meeting following the release of FY25 results.</li><li>The company managed to achieve its highest ever production level of 39.13 MMBOE in FY25. Management highlighted that the additional 15% royalty charge resulted in a revenue loss of Rs9bn loss for the company.</li><li>In its initial phase, Spinwam is expected to produce around 30 mmcfd, while Shewa is currently operating at about 50-60 mmcfd. However, the company is targeting a combined production of 300 mmcfd from both fields. This will also require an additional pipeline from SNGP and a field development plan, for which discussions are underway.</li></ul>

Mari Energies (MARI) held its 41st Annual General Meeting following the release of FY25 results.The company managed to achieve its highest ever production level of 39.13 MMBOE in FY25. Management highlighted that the additional 15% royalty charge resulted in a revenue loss of Rs9bn loss for the company.In its initial phase, Spinwam is expected to produce around 30 mmcfd, while Shewa is currently operating at about 50-60 mmcfd. However, the company is targeting a combined production of 300 mmcfd from both fields. This will also require an additional pipeline from SNGP and a field development plan, for which discussions are underway.

Topline Flash Note: Mari Energies Limited (MARI) - AGM Key Takeaways

Sui Northern Gas Pipelines Limited / Equity Bottom-Up

Sui Northern Gas Pipelines Limited (SNGP PA)

<ul><li>As per news reports, Federal Cabinet has lifted ban on new gas connection, however, these new connections will be provided at RLNG rate, which is around US$12-13/mmbtu, or Rs3,300-3,700/mmbtu.</li><li>We believe, the lifting of ban on gas connections will bode well for E&P companies as alone SNGP has curtailed over 300 mmcfd of gas from domestic gas exploration companies namely PPL, OGDC, MARI, and POL.</li><li>With news reports suggesting pending gas connection request of 3.2mn (for SNGP) and assuming 3.5mn country wide gas connection requests, this has potential to consume additional 250mmcfd of gas (equivalent to 2.5 cargoes additional).</li></ul>

As per news reports, Federal Cabinet has lifted ban on new gas connection, however, these new connections will be provided at RLNG rate, which is around US$12-13/mmbtu, or Rs3,300-3,700/mmbtu.We believe, the lifting of ban on gas connections will bode well for E&P companies as alone SNGP has curtailed over 300 mmcfd of gas from domestic gas exploration companies namely PPL, OGDC, MARI, and POL.With news reports suggesting pending gas connection request of 3.2mn (for SNGP) and assuming 3.5mn country wide gas connection requests, this has potential to consume additional 250mmcfd of gas (equivalent to 2.5 cargoes additional).

Topline Flash Note: Pakistan E&Ps and Sui Cos: Lifting of Ban on Gas Connection; Some Respite for Domestic E&Ps Production

<ul><li>Sui Northern Gas Pipeline (SNGP) conducted its analyst briefing where management discussed financial performance and future outlook.</li><li>Unaccounted for Gas (UFG) has declined to 4.93%, marking an annual volumetric reduction of 4% (from 32.6 bcf to 31.3 bcf), reaching its lowest level in 18 years.</li><li>The company achieved new gas connectivity of 95 mmcfd with the completion of the Shaheed Fahad Ashfaq Project, and integrated the Bannu West-1 and Wali gas fields into its network.</li></ul>

Sui Northern Gas Pipeline (SNGP) conducted its analyst briefing where management discussed financial performance and future outlook.Unaccounted for Gas (UFG) has declined to 4.93%, marking an annual volumetric reduction of 4% (from 32.6 bcf to 31.3 bcf), reaching its lowest level in 18 years.The company achieved new gas connectivity of 95 mmcfd with the completion of the Shaheed Fahad Ashfaq Project, and integrated the Bannu West-1 and Wali gas fields into its network.

Topline Flash Note: Sui Northern Gas Pipeline (SNGP): Corporate Briefing Key Takeaways

<ul><li>OGRA has approved a 6.6% hike in gas prices against SNGP's demand of 40-42% to cover a shortfall of Rs207bn.</li><li>The government needs to announce its decision on OGRA's recommendation within 40 days, with IMF setting a benchmark for price adjustments by July 1, 2025.</li><li>SNGP's average operating assets have been adjusted downward, but the WACC has increased to 25.92%.</li></ul>

OGRA has approved a 6.6% hike in gas prices against SNGP's demand of 40-42% to cover a shortfall of Rs207bn.The government needs to announce its decision on OGRA's recommendation within 40 days, with IMF setting a benchmark for price adjustments by July 1, 2025.SNGP's average operating assets have been adjusted downward, but the WACC has increased to 25.92%.

Sui North Gas (SNGP) - OGRA Approves 6.6% Hike in Gas Prices; SNGP BUY Maintained

Pakistan

SNGPL is the largest integrated gas company serving more than 7.22 million consumers in North Central Pakistan through an extensive network in Punjab, Khyber Pakhtunkhwa and Azad Jammu & Kashmir.

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Sui Northern Gas Pipelines Limited (SNGP PA)

Pakistan Oil & Gas and Fertilizer – Allocation of Gas from Mari Field; MARI to Emerge as Beneficiary; Neutral for Fertilizer Companies

Mari Energies (MARI) has announced the approval of gas allocation from its Ghazij/Shawal discoveries in the Mari field at well head gas prices...

Topline Securities

Topline Flash Note: Mari Energies Limited (MARI) - AGM Key Takeaways

Mari Energies (MARI) held its 41st Annual General Meeting following the release of FY25 results. The company managed to achieve its highest ever...

Topline Securities

Topline Flash Note: Pakistan E&Ps and Sui Cos: Lifting of Ban on Gas Connection; Some Respite for Domestic E&Ps Production

As per news reports, Federal Cabinet has lifted ban on new gas connection, however, these new connections will be provided at RLNG rate, which is...

Topline Securities

Topline Flash Note: Sui Northern Gas Pipeline (SNGP): Corporate Briefing Key Takeaways

Sui Northern Gas Pipeline (SNGP) conducted its analyst briefing where management discussed financial performance and future outlook. Unaccounted...

Topline Securities

Sui North Gas (SNGP) - OGRA Approves 6.6% Hike in Gas Prices; SNGP BUY Maintained

OGRA has approved a 6.6% hike in gas prices against SNGP's demand of 40-42% to cover a shortfall of Rs207bn. The government needs to announce its...

Topline Securities

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